Long-Term Bulls

[S3052]

I personally believe establishing a link between BTC and the OWS Movement in people's minds will be pivotal in widespread acceptance of Bitcoin.

Agree 100% with you. This is a big opportunity for bitcoins. If fits very well. At least well enough that it has a strong likelihood to catch a big wave.

[ElectricMucus]

If bitcoin can link the Tea partiers, End the fedders, Occupy wall streeters, with Madison avenuers and Wall street traders we'd have a truly revolutionary medium.

I think if that happens those groups would be obsolete. Among many other things....

[Crypt_Current]

If bitcoin can link the Tea partiers, End the fedders, Occupy wall streeters, with Madison avenuers and Wall street traders we'd have a truly revolutionary medium.

I think if that happens those groups would be obsolete. Among many other things....

Right -- to that extent, the world would be completely different.

[zby]

In defense of Log0s' argument, the fact that a bitcoin has no base value means that it can collapse to zero. Simply because it can collapse to zero means that people will fear that possibility and it is more likely to occur. Gold is a great example. The price of gold is above $1600 this week. We can never guess the 'true' value of gold, but I imagine a huge number of people would buy an ounce above $50 even if they believed no one else in the world would exchange them. When the price of gold dramatically tanked from $1950 to $1550 many people panic sold, but absolutely no one feared that the price would fall to zero. Bitcoin on the other hand is much more susceptible to panic sells. Even if we imagine a higher volume and lower volatility, a crash has no theoretic bottom and that fact alone will lead to more dramatic crashes.

So we have one  investment that can drop from $1950 to $50 and other one that can drop from $1950 to $0.  Is that a big difference?

[ElectricMucus]

In defense of Log0s' argument, the fact that a bitcoin has no base value means that it can collapse to zero. Simply because it can collapse to zero means that people will fear that possibility and it is more likely to occur. Gold is a great example. The price of gold is above $1600 this week. We can never guess the 'true' value of gold, but I imagine a huge number of people would buy an ounce above $50 even if they believed no one else in the world would exchange them. When the price of gold dramatically tanked from $1950 to $1550 many people panic sold, but absolutely no one feared that the price would fall to zero. Bitcoin on the other hand is much more susceptible to panic sells. Even if we imagine a higher volume and lower volatility, a crash has no theoretic bottom and that fact alone will lead to more dramatic crashes.

So we have one  investment that can drop from $1950 to $50 and other one that can drop from $1950 to $0.  Is that a big difference?

Not to sound like a deadbeat argument: But anything is possible, to some extent. However some things are highly unlikely. As for gold it definitely has more intrinsic value but bitcoin has some too. (You can validate the existence of any digital data if you destroy some satoshis. Ie send some to the hash of the data)

I don't think this counts for nothing, it is just that this value hasn't been realized yet by most people. ( I think the implications of this are quite profound if you consider that everything having to do with open source ideology was pretty much the only engine for growth in the last few years. )
This will change the world in the next 20 years dramatically independent of bitcoins success.

[netrin]

Infinitely different.

[zby]

Infinitely different.

What is left is infinitely bigger in the first case but the loss is not even 3% bigger in the second case   How it is weighted depends on your utility function or your psychology.  If you rely on it to be your last resort reserve - then it is a big difference but if it was an investment (or a lottery ticket) - then there would not be much difference.

[netrin]

Prices are geometric nor arithmetic. It's a curve not a line. A drop from $1000 to $10 is just as dramatic as from $10 to $0.1 repeat that logic, then repeat again, infinitely.

The point though is that because a crash MIGHT be dramatic, then the panic will be greater and thus actually cause a greater drop, and that feedback process might have no end. Whereas pressure to buy gold builds (exponentially?) as the speculative to inherent ratio decreases. A good with no inherent value always has an infinitely inflated speculative value/inherent value irrespective of it's price. The value of a dollar is absolutely arbitrary, but is riding on purely psychological momentum since it launched from its gold backing.

For posterity, I note again ad nauseum, that a bitcoin transaction has value and is priced exclusively in bitcoin (fees and inflation tax). If euros had wings, we'd trade all our dollars for flying money. Bitcoins are better.

[Crypt_Current]

One thing in the comparison of bitcoin to gold that I don't quite understand, is this whole assumption that gold (and/or silver, etc.) would always have a minimum price that people won't let the commodity fall under, presumably because those commodities are so much more precious (and useful?) than BTC...

But... I am never going to buy any gold or silver or anything like that, that I cannot personally HOLD in my hands.  My bitcoins, even though virtual and non-tangible, they are MINE on my usb and micro sd drives and I can do what I want with them, directly.

[netrin]

Any asset backed by gold is valuable because you believe you can obtain your gold. The risk that perhaps you can not should be priced in. If you don't have the gold in your hand you are only speculating. You are not gaining any reward from the good itself.

In response to the statement "but you can't do anything with gold" Marc Farber says he'll take all of your gold and then soon he'll have all of your women. "If it were not for women, all of the world's money would be for naught". Bitcoins on a usb stick have very low chick appeal.

[zby]

That depends on stick I guess.

[Crypt_Current]

Any asset backed by gold is valuable because you believe you can obtain your gold. The risk that perhaps you can not should be priced in. If you don't have the gold in your hand you are only speculating. You are not gaining any reward from the good itself.

In response to the statement "but you can't do anything with gold" Marc Farber says he'll take all of your gold and then soon he'll have all of your women. "If it were not for women, all of the world's money would be for naught". Bitcoins on a usb stick have very low chick appeal.

+1, Yes; how could I forget?  First we get the money, then we get the khakis, THEN we get the women ...

[Crypt_Current]

my bull's horns are like 16GB long

[322i0n]

i buy dollars because they are made of paper, i like paper becuase it is made of trees trees were real creatures before they came money, not metaphorical creatures.. real creatures. dollars are green and i like the color green. i also like the picture of the pryamid with the eye in the middle and i like to collect all the presidents so i can remember who they are.  i also buy dollars cause there is a neat trick you can do that shows the picture of the twin towers with a plane crashing in to them.

I also think it is great that the government and the isrealian people in the federal reserve can print dollars out of thin air.

thats so cool man. i love dollars.

[Crypt_Current]

i buy dollars because they are made of paper, i like paper becuase it is made of trees trees were real creatures before they came money, not metaphorical creatures.. real creatures. dollars are green and i like the color green. i also like the picture of the pryamid with the eye in the middle and i like to collect all the presidents so i can remember who they are.  i also buy dollars cause there is a neat trick you can do that shows the picture of the twin towers with a plane crashing in to them.

I also think it is great that the government and the isrealian people in the federal reserve can print dollars out of thin air.

thats so cool man. i love dollars.

Oh totally, the USD is by far the most aesthetically pleasing out of them all

[dree12]

I don't see how that's relevant to reasons people buy dollars and sell them to other buyers....Facts about the history of dollars may make dollars more stable compared to bitcoins, but what I'm saying is that those facts don't enter into the minds of most people as reasons they buy dollars.

When dollars WERE backed by gold, they easily crossed this acceptance threshold. When the backing was removed, the fiat was sufficiently established. So, while the historical backing is not relevant today, it was relevant to its establishment in people's minds.

There are only 21 million bitcoins out there, so ANYONE could back bitcoins with Gold. If you have 21000oz, you can give out an oz for every 1000 bitcoins.

A good with no inherent value always has an infinitely inflated speculative value/inherent value irrespective of it's price. The value of a dollar is absolutely arbitrary, but is riding on purely psychological momentum since it launched from its gold backing.

I don't think the value of a dollar is arbitrary. It certainly has a floor because 300 million people in the US find it directly usable, unlike Bitcoin. Until you can pay taxes in Bitcoin, it will be completely speculative.

[paraipan]

i buy dollars because they are made of paper, i like paper becuase it is made of trees trees were real creatures before they came money, not metaphorical creatures.. real creatures. dollars are green and i like the color green. i also like the picture of the pryamid with the eye in the middle and i like to collect all the presidents so i can remember who they are.  i also buy dollars cause there is a neat trick you can do that shows the picture of the twin towers with a plane crashing in to them.

I also think it is great that the government and the isrealian people in the federal reserve can print dollars out of thin air.

thats so cool man. i love dollars.

nice one man, that would be the best description of the dollar's value by far

[ElectricMucus]

I don't see how that's relevant to reasons people buy dollars and sell them to other buyers....Facts about the history of dollars may make dollars more stable compared to bitcoins, but what I'm saying is that those facts don't enter into the minds of most people as reasons they buy dollars.

When dollars WERE backed by gold, they easily crossed this acceptance threshold. When the backing was removed, the fiat was sufficiently established. So, while the historical backing is not relevant today, it was relevant to its establishment in people's minds.

There are only 21 million bitcoins out there, so ANYONE could back bitcoins with Gold. If you have 21000oz, you can give out an oz for every 1000 bitcoins.

Who is gonna verify that?

Let me propose something: What about a system were which anonymously and autonomously selects people living in your area to meet with you were you can verify each others physical assets and exchange them. We can exchange some public keys when we meet and provide reputation for each other.
This could also be implemented as a decentralized web of thrust and a decentralized exchange for bitcoins against physical assets.

[netrin]

There are only 21 million bitcoins out there, so ANYONE could back bitcoins with Gold. If you have 21000oz, you can give out an oz for every 1000 bitcoins.

Uh... I could today. Maybe this week. But I won't make an indefinite guarantee. And neither will anyone else.

I don't think the value of a dollar is arbitrary. It certainly has a floor because 300 million people in the US find it directly usable, unlike Bitcoin. Until you can pay taxes in Bitcoin, it will be completely speculative.

Everything is speculative. The history of fiat currency since long before the Chinese invented paper is an inauspicious tale. Dollars will decompose, it's just a matter of when.

[dree12]

There are only 21 million bitcoins out there, so ANYONE could back bitcoins with Gold. If you have 21000oz, you can give out an oz for every 1000 bitcoins.

Uh... I could today. Maybe this week. But I won't make an indefinite guarantee. And neither will anyone else.

The US made an indefinite guarantee, and reneged on it later on. You're still backing it.